Buying a home comes down to a question of money – how much will it cost, how much do you have and where will you get the rest. Five years ago, the joke was anyone who could “fog a mirror” could get a loan. No more. Lenders have thrown the mirror away and practically reinstated the Spanish Inquisition to probe every facet of a loan applicant's balance sheet.

To prepare for buying a home, experts recommend consulting a financial planner or attending a first-time-buyer workshop before deciding whether buying is better than renting. Part of the calculation involves your credit standing, how much you make and spend, and what you have left for homeowner expenses.

“When you're faced with a crisis or economic turbulence,” said Jim Lingelbach, president of the San Diego chapter of the Financial Planning Association, “it's always good advice to revert back to the fundamentals, which are spend less than you make, save as much as you can, and don't make any obvious mistakes.”

Some rules of thumb: Spend no more than 29 percent of your monthly gross income on a mortgage payment or 41 percent of income on all long-term debt. Demonstrate at least two years of uninterrupted employment.

WHAT TO BUY

Your dream house may be a castle in the country, but your first home may be a condo conversion, a tiny house on a postage stamp-sized lot or a property far from your work place. The broadened choices today include buying from a bank that has foreclosed or a seller seeking a “short sale” – which needs the bank's approval before selling at less than the outstanding mortgage balance.

At every step of the way, you face making compromises, and you have to weigh the pros and cons. But in the new buying environment, you have the luxury of time to weigh all the choices.

“You don't have to rush on anything,” said Alex Lluch, a former engineer turned author on home buying, selling and many other consumer topics.

WHERE TO BUY

The beach, the backcountry, downtown or the 'burbs – San Diego buyers have many choices. Along with what you buy, you're also buying into the neighborhood – its parks, schools, crime statistics and people who you'll borrow sugar from.

But from the comfort of your computer screen, you can preview all parts of the county before heading out for an on-the-ground look-see. Don't count on your agent to act as tour guide. This is your job to know the territory and prioritize your options.

“With the Internet, now what ends up happening is they come to me with a list – 'We saw these properties,'” said Jorge Vega of Community Realty Group.

HOW TO BUY

You're not alone. You have real estate agents, loan officers, home inspectors, movers, handymen, furniture dealers, landscapers and many other people waiting for your business. With so many new factors going into home buying, this is no time to go it alone when it comes to your biggest purchase ever.

“I think you want somebody with more experience rather than less,” said consumer author Ilyce Glink, author of “100 Questions Every Buyer Should Ask.”

During the boom, it didn't seem necessary to pay attention to all these details; if you went wrong, you could always sell at a quick profit and move on. But today, a mistake may doom you to a bad loan or a problem-ridden property.

Dustin Hobbs, spokesman for the California Mortgage Bankers Association, said first-timers can deal by phone or online with potential lenders or get up close and personal with their local bank.

“In this environment, it's important that borrowers are as engaged as possible,” Hobbs said. “Ask a lot of questions; fully understand their mortgage terms.”

DETAILS TO CONSIDER

After selecting the home and choosing the loan, there are many details to attend to – negotiating with the seller and lender, selecting insurance agents and home inspectors, communicating with escrow officers, budgeting for property taxes and mortgage and home insurance, and planning for moving day.

And there's one more thing: buyer's remorse.

This can easily be your biggest purchase ever, and you may have to live with it for many years. So it pays to think through every stage of the buying process and consider every possible alternative.

“I think there's more caution on the part of prospective home buyers than there was five years ago,” said Dean Brown, housing program manager at the San Diego HUD office. “Be careful, beware, be cautious.”